Citigroup analyst Chris Danely on Intel (INTC-0.7%) [Neutral rating] at a conference in New York: "In speaking with investors, our biggest surprise in terms of positioning is how many people are long Intel, mostly on the “data center will be better” theory. We believe the risk/reward is no longer attractive on INTC stock as even if their data center business grows 10% QoQ, it is already in guidance and potential downside from the end of the PC inventory replenishment outweighs data center strength."

Though he further attributes a recent pullback in the chip sector to overly high expectations, he sees demand trends as mostly stable or seasonal. Citing that view, Danely notes he would buy Microchip Technology (MCHP-2.1%) and ON Semiconductor (ON-2.3%) for upside on their of late downtrends (each around 5% lower since last Friday).